By Dan Eduard – Over the last two weeks, the US dollar has been dropping at a steady rate against the Danish krone. Since the 12th of September, the USD/DKK pair has fallen almost 3500 pips, to its current level of 5.5375. As we will see through a variety of technical indicators, the pair may have hit a low point and has the potential for a significant upward correction.
We will be looking at the 8-hour chart provided by Forexyard. The technical indicators being examined are the Stochastic Slow, Relative Strength Index (RSI) and Williams Percent Range.
1. The Stochastic Slow has recently formed a bullish cross, meaning that an upward correction is likely to occur in the near future.
2. This theory is supported by the Relative Strength Index, which is currently right around the 20 level. Typically anything below the support line at 30 is a sign of the pair being oversold. Traders can take this as a sign that a bullish move may occur.
3. Finally, the Williams Percent Range, currently at the -90 level, is well into oversold territory. This lends further support to our original theory that upward movement is likely to occur.
Forex Market Analysis provided by ForexYard.
© 2006 by FxYard Ltd
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